Cabinet Clears Plan To Revive Yes Bank; ICICI Too Steps In
The Union Cabinet on Friday cleared a draft resolution scheme for the troubled Yes Bank.
Last week, the Reserve Bank of India (RBI) had announced a draft scheme of reconstruction for the country’s fourth-largest lender.
According to the scheme, investor in the bank will pick up 49 per cent stake and maintain holding above 26 per cent for three years from the date of capital infusion.
The scheme was announced a day after the central bank imposed a month-long moratorium on the bank and restricted withdrawals to Rs 50,000 per depositor till April 3, citing its poor financial health due to bad loans.
On Thursday, State Bank of India (SBI) on Thursday said it will infuse Rs 7,250 crore into Yes Bank and pick 725 crore shares at Rs 10 each, and its shareholding will remain within 49 per cent of the paid-up capital.
Meanwhile, in a related development, the board of ICICI Bank on Friday approved an investment of Rs 1,000 crore in Yes Bank via equity route.
ICICI Bank will acquire 100 crore equity shares of Yes Bank at Rs 10 per share, including a premium of Rs 8 per share.
“This investment is likely to result in ICICI Bank holding in excess of 5 per cent shareholding in Yes Bank, with the final shareholding to be determined based on the final Scheme of Reconstruction and share issuance thereunder,” ICICI Bank said in a statement.
The announcement came as the Union Cabinet approved Yes Bank’s restructuring scheme to safeguard depositors’ interest and ensure a stable financial banking system.
ANI
